Former Mojo Coffee and Sanitarium executive Pierre van Heerden will be New Zealand’s first Grocery Commissioner.
Van Heerden starts the job on July 13, has been appointed for a five-year term and will join the Commerce Commission’s board.
In his new role van Heerden will monitor the state of retail supermarket competition and whether consumers are getting a fair deal, keep an eye on how retailers are treating suppliers, and investigate whether competitors are getting a decent offer from the newly-opened wholesale networks.
The new Commissioner will take charge of a range of enforcement actions, including fines.
Van Heerden was most recently chief executive of coffee chain Mojo, but has had an extensive retail and food career, including as executive general manager for Sanitarium.
Commerce and Consumer Affairs Minister Duncan Webb said van Heerden’s appointment was a significant one to hold the sector to account.
“Pierre brings more than 25 years’ experience in the grocery sector, having held roles such as chair of the Food and Grocery Council of New Zealand, and has been recognised as an advocate for consumer value and transparency. This will be essential in his role addressing the nature of competition in the grocery sector and the improvements we want to see over time.”
Webb said “an important focus” for the Commissioner will be in levelling the playing field and ensuring increased competition in the grocery industry, for the benefit of consumers.
The Commerce Commission’s market study into the grocery industry found competition in the supermarket sector wasn’t working well.
The Government introduced legislation to improve competition which included creating the new role of Commissioner to oversee the industry. The Grocery Industry Competition Bill also requires the duopoly of Foodstuffs and Woolworths to open up supply chains to rivals, introduced a supplier code of conduct and a supplier dispute resolution scheme.
The Commission's funding has been boosted by more than $28 million to cover the new supermarket regime.
Supplier group, NZ Food & Grocery Council, welcomed the idea of a Commissioner in 2022. Then, it said the Commissioner would hold supermarkets to account and promote desperately needed competition.
“A hard-nosed approach is exactly what is needed, and this is the right way to go to ensure that happens."
Suppliers have complained they are at the mercy of Foodstuffs and Australian-owned Countdown, forced to meet specific margins on products against threats of being dropped from shelves.
Others in the industry haven't been as enthused with the Government's reaction to the Commission's findings.
Online supermarket founder Sarah Balle, who started Supie two years ago, has criticised the Government's response and said the wholesale changes in particular would concentrate power further with the duopoly.
The Government also introduced legislation banning restrictive land agreements that locked new entrants out of prized locations for supermarkets.
5 Comments
He'll need a bunch of people to report to him. One or two lawyers (maybe within com com) a PA and at least another admin person.
"The Grocery Industry Competition Bill also requires the duopoly of Foodstuffs and Woolworths to open up supply chains to rivals,"
Why weren't they available before unless there is some form of vertical integration in the supply chain? If they blocked supply through vertical integration then surely this is anti-competetive behaviour and subject to being charged?l
A civil servant solution to the problem is more civil servants.
But really we need competition.
That could be achieved, without much civil servant creation, by limiting the number of outlets in each group to say 50. NW has approx 250 currently.
Hard law and regulation, not civil service tinkering is the way. You don't have do other than demand it happens by date x, let the chains decide how to break up, and even from that some innovative things could arise.
That would allow new entrants, and they would not necessarily be the same big box pattern we have now. The huge chains are not efficient, they make profits by control.
Multiple operators, even just six outlet ones, gives both consumers and suppliers choices over where to deal.
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